Bill that would have allowed insurers to track driving habits dies in California Legislature

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Set us as preferred A bill that would have allowed California insurers to track motorists driving habits in exchange for potentially lower rates has come to a dead end.The Consumer Driving Data Protection Act, proposed by Assemblymember Tina S.McKinnor (D-Hawthorne), failed to make it out of the Legislature this week after stiff opposition from consumer and data privacy groups.The legislation would have permitted insurers to use telematics technology to track speed, braking and other driving habits to establish a motorist’s safety record, a key component in setting individual premiums — as long as a motorist consented.

Business A proposed state law would allow insurers to track the habits of California drivers to get the cheapest insurance.Currently, the safety record is determined by the Department of Motor Vehicles’ point system, which takes into account moving violations and at-fault accidents.Telematics had the potential to offer the lowest premiums for drivers with spotty driving records who improved their driving habits, but opponents contended it violated Proposition 103, the 1988 initiative that regulates auto rates.The measure requires that drivers with a good DMV driving record get a minimum 20% discount.Data privacy groups also feared the data collected by third-party telematics companies on behalf of insurers might be disclosed.

There was no guarantee that tracking would lower rates.A study last year by the Maryland Insurance Administration found that in 2023, 31.2% of drivers in the state who enrolled in telematics-based insurance experienced a rate decrease, 23.6% saw an increase and 45.2% of rates were unchanged due to telematics ratings factors.

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